RSSAnalysts: Studios will gain from HD DVD's exit, but consumers' won't
By Jacqueline Emigh | Published February 20, 2008, 1:39 PM
Consumers would really have been better off right now with Toshiba's HD DVD format for high definition video than with Sony's Blu-ray approach, a principal analyst at ABI Research told BetaNews today.
Big film studios will gain from Toshiba's exit from the high definition (HD) disk market, although not as much as they'd like -- and consumers won't benefit at all, at least initially, according to analysts at market research firm ABI Research.
The format battle between Toshiba's HD DVD format and Sony's Blu-ray approach was causing major problems for 20th Century-Fox, Warner Bros., and other movie studios, noted ABI Principal Analyst Steve Wilson.
"Consumers spent [only] about $170 million on high-def DVD in 2007 and Fox, for one, is hoping that jumps to $10 billion in 2008," Wilson said, in a Q&A today with BetaNews.
Still, even industry standardization around Blu-ray won't boost sales as much as the movie studios want.
"They'll be lucky if they get to two-thirds [of the $10 billion]," the analyst remarked.
Wilson also suggested that consumers would really have been better off with the HD format than with Blu-ray.
"Storage capacity is the one area [where Blu-ray] can claim an advantage," he elaborated. But the outcome of the format war, which became official on Tuesday, "doesn't benefit anyone today and it comes at a cost. [Blu-ray] discs and players are both more expensive to manufacture. The DVD format was less expensive to implement and further along in its deployment. [Blu-ray] is twelve months behind in terms of its feature set."
To wrap a bit of historical perspective around the reactions of ABI and other observers, only a year or two ago, a lot of people would have been quite surprised by any notion that Blu-ray would prevail over HD. Back then, an independent market research group called Cymfony analyzed postings on message boards, blogs, and other Web pages to gauge the opinions of early adopters of blue-laser consoles, mainly among gamers and videophiles.
"Positive discussions about HD DVD are 46 percent higher than for Blu-ray, with over twice as many post authors being 'impressed with HD DVD' as 'impressed with Blu-ray,'" according to the results. (PDF available here) which covered the period between October 1 and November 23, 2006. Cymfony describes itself as "a market influence analytics company that sifts and interprets the millions of voices at the intersection of traditional and social media."
The Cymfony researchers further found that Sony and its Blu-ray format suffered from a "credibility gap" due to Sony's past failures with technologies such as Betamax and MiniDisc.
In addition, gamers at the time were found to have been unhappy that the PS3 console comes with a Blu-ray player. "Beyond the increased cost, they objected to Sony giving them no choice," according to the report. Ironically, based on their analysis of the Internet content studied, the Cymfony researchers posited "strong dislike for Blu-ray" as the the main reason why users have been hestitant to adopt HD drives.
"Mainstream media focus on the high cost of Blu-ray and the 'format war' as reasons consumers may be slow to embrace high definition video. But these aren't the biggest reasons currently discussed in social media," according to the study. "Post authors express a general dislike for Blu-ray, often based on doubt regarding Sony's credibility as a technology innovator and ability to succeed with a new platform."
In fairness, Blu-ray did suffer from some technical issues in 2006 that no longer exist. Most notably, studios have weaned themselves from MPEG-2 compression, which was often visibly noticeable and not nearly as efficient as H.264-based codecs such as MPEG-4. As a result, the first BD discs couldn't take full advantage of the huge space alloted for them. And the first BD discs off the block suffered from film transfer problems that early adopters initially attributed to faults with the format rather than the process.
Plus, early Blu-ray players suffered from bugs with noise cancellation and other features, resulting in disgruntled customers. But that anger became very public, thanks to the Internet, and it was that anger that may have helped taint the second wave of adopters -- those contacted by the Cymfony study.
In the end, though, it wasn't customers' likes or dislikes that powered the fatal blow in the format war, according to ABI. It was Warner Bros.' decision to switch allegiance to Blu-ray, along with subsequent moves to dump HD by major retailers such as Wal-Mart, Netflix and Blockbuster, that served as the key catalysts in the rather sudden industry migration to Blu-ray.
"Consumer spending on DVD sales and rentals was pretty flat in 2005 and 2006 at about $22 billion. It dropped last year for the first time, by about 3 percent," Wilson said today.
"The studios really need the new high-def format to catch on so they can drive revenues back up," the ABI analyst told BetaNews.
I have no confidence in Sony and have already went with HD-DVD. I like the HD-DVD players so much that when toshiba announced it would stop building their players I promptly bought 3 more. That being said I will collect all the HD-DVDs I can and I will stick with DVD. By the time DVD goes away there will be other formats to choose from,
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|Toshiba should really stick it to them now and open source the HD DVD project. Can't loose any more...
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|Looks like we now wait for Super High Vision (7680 by 4800 or thereabouts)
I will not be buying Blu-Ray until they have been cracked and (region free) backups are possible. In all likelihood I will never buy blu ray, it is almost a dead technology already.
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|SONY
CAVEAT.....Apple TV & VUDU loom!!!!!!!!!!!!
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|Wait until you see what they have planned for the 'development' of Blu-ray.
Scary is not the word.
You'll be sorry.
Just cos Blu-ray 'won' does not mean we ought to accept it at any price.
Blu-ray's problem is that comes with a host of other problems.
No thanks, I like so many others will leave it alone in the PS3 niche where it belongs and where the f*ckwit fanboys can suffer getting what they wished for.
They're welcome to it.
Looking forward to profile 2.1 (and the reaction when the idiots find out they're going to have to start paying for profile updates - oh yes, that one is well in the works - to get certain 'features').
Meantime I'll be laughing my legs off at those who have cheered this disaster on.
Blinkered idiotic ignorant morons.
You deserve every bit of what's coming.
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|what i don't understand is how HD-DVD fans love high def movies and and are early adopters....UNTIL blu ray wins the format war. Now all of the sudden they think high def movies aren't worth it, too expensive, and can be beat by a DVD upscaler. They also now think that the high def disk medium is obsolete because people are going to start downloading movies. Sooo if you thought all of this why the heck did you buy into HD-DVD??? I'm all about blu ray, but if hd-dvd had won i would've sucked it up and gone out and bought a hd player..because i like HD movies, simple as that. The format isn't that big a deal to me. Why are there so many idiots out there?
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|Well, you can take some of it as sour grapes but you can also take it that many feel cheated by the inferior tech being chosen. Most of what I have read point to HD DVD being the better format. That being said I feel that consumers feel completely impotent with respects to this issue and that make s people sour.
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|I can't speak for anyone else here, but I'll give you my perspective on this.
I own and have used both formats. While I think the feature's picture is outstanding in both formats, I have issues with blu-ray (as a format) overall.
First, uncompressed audio is completely unneccesary. It takes up an ungodly amount of space, pretty much negating any advantage that the format has, in that capacity. Why not use the lossless audio codecs, and use the space saved to put the extra features on the SAME DISC?
Second, the feature set (while it is getting better) still doesn't offer me the 'next gen movie experience' that HD DVD does. In regards to standard DVD, I rarely looked at any of the extra content, beyond deleted scenes. With HD DVDs PIP ability, a lot of the other features became relevant to me. Instead of just watching a 'making of documentary' about 300 (for example), HD DVD allowed me to watch a side by side comparison of scenes, with and without the CGI. With blu-ray, it was still just a documentary...the same thing that standard DVD offered, just with a better picture. Even with profile 1.1 available, there aren't that many films available that are taking advantage of it (yes, it's still relatively new, and that will most likely change).
My third reason deals with the another aspect of the 'profile issue'. This is something that should never have even come about. While HD DVD launched with a full and mature feature set (granted, web interactivity took longer to be used, but the ability was there from day one); Blu-ray got pushed out the door, as an incomplete product, simply so that it could remain relevant on the store shelf. The arrogance displayed by stand-alone manufacturers doesn't help them out, IMO.
I'm sure that the profile issue will extend beyond hardware, into the media realm, too. How long do you think it will be, until studios start 'double-dipping' early releases, in order to take advantage of each, newer profile, and it's features?
Never mind the fact that with each new implementation, there are hundred's of reports from users who are having problems. This media should be hitting the market in a way that allows each user of the format to take advantage of, without having to jump thru some hoop to do so. The need to upgrade the firmware each and every time they try something new is tiring. We're supposed to be the BDA's customers, not their beta testers, dammit.
I'm not bowing out of the hd media market, entirely. With a few exceptions, I won't be buying blu-ray discs until they get these things sorted out...and I don't mind waiting. Until then, the alternatives will work fine for me.
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|"...I feel that consumers feel completely impotent with respects to this issue and that make s people sour."
Personally, I don't feel this way at all.
Blu-ray may have won this 'war', but that doesn't mean they've won me over, as a customer. When they can offer me an experience similar to HD DVD's, they can have some of my cash...not before.
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|I am a HD-DVD fan and I love High Def Movies. However I will not be buying a blu-ray player for a number of reasons. 1. The Players are still too expensive, 2. The movies are too expensive, 3. It is not region free, 4. It can't be streamed across a home network, 5. It can't be backed up, and 6. THEY HAVEN'T EVEN FINISHED THE SPECIFICATIONS YET so who knows what they are going to do with it. At least HD DVD was a full featured and finalized format. Blu-ray is constantly undergoing changes and this is great for Sony and their PS3, but a but head ache for standalone set top boxes. And to be honest, I think Sony have played dirty with this war and don't want to give in to their dirty games. HD-DVD was the true sequel to DVD. Blu-ray is starting from scratch and they have a lot to learn yet before the format become ready for the masses.
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|I have a feeling by the time BD becomes mainstream and inexpensive the tech will have passed them by for the next best thing.....
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|Good thing it's only gonna be a feeling then, eh?
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|Going to argue against his prediction with a just as ridiculous prediction of your own then, aye?
Well, at least we're being consistent here.
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|What the hell? This is a horribly biased article.
Apparently reading internet message boards is a basis for saying HD-DVD should have won, rather than looking at sales, studio adoptions, tech specs and nearly everything else?
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|You didnt read the whole section and the context relating to that did you? You skimmed and saw several words you did not like.
It is a bit of history as the article says. It does not say HD-DVD should have won because a market research group 2 years found that people back then would have been suprised to find blu-ray would win.
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|I think you missed some of the key points.
First, the article illustrates why, from an analysts perspective, HD DVD should have been the winner: cost of manufacture, and the lack of implentation on the feature set.
Cymfony took a unique approach to consumer polling. Instead of contacting consumers and asking them pointed questions, this group went to where the consumers were discussing the products and used those unsolicited comments as the basis for their report.
Furthermore, Cymfony didn't just randomly select a handful of posts. They did a fairly detailed analysis of 2000 posts before coming to their conclusions.
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|This site is ridiculously Microsoft/HD-DVD biased. Always has been.
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|This site isn't biased at all. They're just stating fact. HD-DVD was much better than Blu-Ray. Every HD-DVD disc released in the USA used MPEG-4 video compression. Since Blu-Ray was rushed to market it used inferior MPEG-2 compression for a long time. Even with the higher bitrate, Blu-Ray's MPEG-2 video was still worse than HD-DVD's MPEG-4 video. HD-DVD has always had better audio than Blu-Ray. Besides, no one ever really found a good use for the extra space on movie Blu-Ray discs.
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|I find it funny that any site that doesn't stroke the BDA's collective ego, is supposedly 'biased'.
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|I don't know what else you post, but that seems highly uninformitive...I would see it the other way around. Don't let your bluray love make you that ignorant
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|And that has nothing to do with the specs, but with individual movies.
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|True, but you've got to admit...most of the early releases for blu-ray didn't exactly inspire confidence in the format.
Hell, the first release of The Fifth Element made me question what the big deal was, at all.
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|The fact that new versions of some Blu-Ray titles even had to be released a second time at retail is ridiculous. This never happened once on HD-DVD.
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|I'll agree with you, to a point. Remember though, even standard DVD has had movies remastered to give a better picture on subsequent releases...
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|Betanews has posted a couple of highly bizarre pro-HD DVD articles recently. Not sure why but it's kind weird to see this fud long after it no longer matters.
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|OK, So Sony bought the studios and their high prices provided great profit margins to drive sales, but don't talk tech specs. Blu-ray still to this day can not match HD-DVDs specs and are probably still 12 months away from doing so.
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|thats because sony and the studios choose not us nowwe are screwed from hidef ever taking off because of sony and the studios greed did the dvd forum accept poo-ray yet?
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|This is yet another great article from Betanews. If only blueray fanboys weren't ignorant. But at least, hollywood is happy, BDA is happy. They can earn a lot of money, but not from me :)
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|Don't let facts get in the way of your fanboy rant there.
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|"To wrap a bit of historical perspective around the reactions of ABI and other observers, only a year or two ago, a lot of people would have been quite surprised by any notion that Blu-ray would prevail over HD."
Well, no kidding when M$ is buying analysts to write good things about HD-DVD and bad things about Blu-Ray. They are doing the same thing for their closed, proprietary M$OOXML format.
Blu-Ray outsold HD-DVD in both players and hardware since it came out. While HD-DVD fanbois and paid shills were astro-turfing every site on the web with propaganda, the paying public voted with their money.
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|Astro-turfing?
If the blu-ray idiots actually kept to the facts on hand and stop speculating on the future while pushing it as fact then you might have a point.
They simple got their s*** back.
They started the bulls*** propaganda; I am not at all surprised they got it back from hd-dvd fans
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|If you think that the "consumer" chose Blu-Ray you are sadly mistaken. In case you don't recall, which I am sure you do, HD-DVD was killing Blu-Ray until Sony forced Blu-Ray down the PS3 gamers throats. Then there was the fact that the studios always supported Blu-Ray more than HD-DVD. I guarantee you without Sony forcing Blu-Ray down peoples throats and buying out several studios they would be on the losing end of the battle today. That is just business and that's the way it goes, but don't even try to spin the whole "the consumers chose Blu-Ray" because that is BS and you know it.
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|Let's go a little bit deeper, here...
If you want to bash on MS for paying off 'analysts', go for it. It's a shady practice. But let's not forget when Sony got busted for 'inventing' a critic, who not only gave them glowing reviews and blurbs to push their movies, but never existed in the first place.
Secondly, according to the NPD, the total number of players sold is as follows:
Blu-ray 49%
HD DVD 49%
Dual Format 2%
These are the machines bought for the SOLE purpose of playing movies. It took a multi-purpose device to save the day for blu.
Propaganda!?!?! With the exception of a few incorrect predictions (and the campaignhd.com website), there was very little in the way of propaganda from the HD DVD camp. In regards to the consumer, the hype (and a games console) is what sold the format. Not it's strengths. Anyone who did the research found that both the PS3 and blu-ray as a format made a lot of promises that have yet to be fully delivered on.
But you don't care, right? You don't support either format...
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|Only you could bring MSFT and OOXML into a Blu-Ray thread.
Gotta love a good troll.
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|And the MS hater has entered the room.
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|In the aftermatch of this 'format war', there is a question that relly concerns me: how much time do you think that it will pass before the studies start to sell films only in HD? I hope that DVD stays with us fo a while, a couple of years at worst.
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|I think they will.
I remember VHS longering for awhile after the INITIAL launch of DVDs.
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|AFAIK, VHS is still available for most releases.
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|I for one will not be embracing this HD cycle for a variety of reasons regarding the wonderful company called Sony...
1...I still want the right to convert my purchased cd's into mp3's to play on my IPOD.
http://arstechnica.com/n...ou-own-is-stealing.html
2...I have rights as a consumer!!
http://consumerist.com/c...cast-vs-sony-237857.php
If I buy a car, will say Ford or whoever make it is sue me for changing the wheel alloys??
3...Always read between the lines with Sony they aren't very consumer friendly
http://www.eff.org/deepl...-rootkit-sony-bmgs-eula
4...Sony have the abilty and will not be afraid to use the DRM even if it flies in the face of Mr Average Consumer.
http://www.videobusiness...CA6480077.html?nid=3514
I dont care what anybody says Sony have proven themselves on numerous occasions to have held back forward invention for their own gain.
AGAIN BYPASS THIS HD CYCLE IT ISNT WORTH THE HASSLE
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|Nah.
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|Blu-ray benefits studios even more because indie films or other content will be much, much less likely to go to Blu-ray any time soon. The cost of Blu-ray replication compared to HD DVD can be as much as 6x higher on short runs!
For instance, a run of 1000 units cost us about $1000 to replicate for HD DVD, vs. approximately $6000 for basically the exact same thing on Blu-ray. That's $6 / unit to replicate, which is beyond ridiculous. It's only when the studios have hundreds of thousands (or more) discs made that it becomes more viable.
This is in part due to the REQUIREMENT of AACS content protection on , even if you don't want it - as well as the higher cost of the glass master and of course the higher per unit cost.
And - in terms of authoring for advanced features, HD DVD is much, much better / easier for developers. Easier = less time = less cost to the producer.
The two specific factors that allowed Blu-ray to 'win' were the inclusion in the PS3 which allowed their numbers of shipped units to be much higher (MS should have included the HD DVD drive within the unit - Toshiba should have subsidized it with lower costs to them); and the real nail in the coffin was the specific $400million+ that Warner Bros received from Sony to jump ship from HD DVD (just as they were about to go the other way - wherein HD DVD would have 'won'). Good move on Sony's part - for them (and WB), not for anyone else.
Personally, I'm holding out for HD IPTV.
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|$400million+?
thats a nice made up number. i guess we'll be seeing it in either companies financial reports?
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|The requirement of AACS is hurt my friends small video business. He films weddings and functions and transfers them onto DVD and more recently HD-DVD. Now that HD-DVD is no more, this only leave blu-ray for his high def videos, however the cost of implementing AACS is crazy. So at the moment he is only producing DVDs
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|The industry can take HD and stick it where the sun don't shine. Too little too late as far as I'm concerned. To be blunt, the entertainment industry sucks big time. Everything was bought out by soda and sport shoe companies years ago, having no tact or taste, only what can be sold to the public with a quick turn over.
As far as this 'format war', it's only natural consumers had very little say, par for the course in this rap-diddy-dap-dap, hip-hop crap, mickey mouse society. The western world has become a bad parody of itself.
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|in other news costco lowered the price on the d3 to 79.99 with 7 movies just grabbed myself a backup player
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|with movie prices the way there i can't beleive they would even reach a billion in sales
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|"Consumers spent [only] about $170 million on high-def DVD in 2007 and Fox, for one, is hoping that jumps to $10 billion in 2008,"
Sweet zombie Jesus! I've read some pretty unrealistic things on this site, but that comment right there has to be one of the most unrealistic...
I think the better question is "Now that the 'war' is over, how are the BDA going to convince the mass market to adopt?"
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|Well i would start by releasing movies exclusively on HD only. What could possibly go wrong?!
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|serious finacial loss for one
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|I'm really hoping that I missed your sarcasm tag; but just in case...
Had we seen HD DVD become the winner of this 'war', then releasing solely in HD DVD would have been a great idea. That format had the Combo discs, which would have allowed the media to gain one hell of a penetration rate.
But, blu-ray won. If the studios suddenly started releasing exclusively in that format, the market would tank. It's one thing to try and shape the market, by releasing the formats at different times; but it's quite another to attempt to force mass adoption, by only offering in the most expensive one.
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|Should this be a surprise to anyone who's dealt with Sony's proprietary, overpriced hardware in the past or fell victim to their rootkits?
Should this be a surprise for anyone who's bought a movie online which had crippling DRM that prevented even the most simple placeshifting from the PC to a media extender connected to their tv, that would likewise be allowed using open, DRM-unencumbered formats like XviD?
Like I said in another article: The consumer had nothing to do with the choice of who "won" the format war. It was the studios and the back-room dealers who wish to end things like first-sale doctrine, and placeshifting of content, replacing it with overly-burdensome DRM, and recurring payments for the same material (buy a disc, then buy the ipod version, instead of one sale of the disc and allowing the consumer to do with what they bought on their own terms).
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